Directors And Officers Liability Insurance

D&O Insurance

Director and officers may be at risk as a result of their position.

Directors and officers liability Insurance (also called D&O) is liability insurance payable to the directors and officers of a company, or to the organization(s) itself. It indemnifies (reimburses) for losses, or advancement of defense costs, in the event the insured suffers a loss as a result of a legal action brought for alleged wrongful acts in their capacity as directors and officers. Such coverage can extend to defense costs arising out of criminal and regulatory investigations/trials as well; in fact, civil and criminal actions are often brought against directors and officers simultaneously.

D&O insurance has become closely associated with broader management liability insurance, which covers the liabilities of the corporation itself, as well as the personal liabilities for the directors and officers of the corporation.

For something as critical as D&O liability insurance, it’s crucial to know exactly what is covered, and what is not. By no means all plans are equal. You should consult with insurance and legal professionals to determine exactly what you need, and whether a particular insurer provides it.